Laemthong International Lines Company Ltd v Artis & Ors

Laemthong International Lines Company Ltd v Artis & Ors

The Receivers' letter of indemnity is enforceable by the Owners under the Contracts (Rights of Third Parties) Act 1999 as the Owners are the Charterers' agents for delivery and the indemnity was intended to benefit them. Both the Charterers and Receivers are obliged to provide security to secure the release of the vessel, and specific performance is appropriate as damages are not an adequate remedy.

Parties
Claimant: Laemthong International Lines Company Limited; First Defendant: Artis; Second and Third Defendants: Second and Third Defendants
Jurisdiction
England and Wales
Judgment Date
08 November 2004
Procedural Posture
Commercial Court Preliminary Issues / Judgment on Preliminary Issues and Directions
Outcome
Declaration granted; specific performance ordered if necessary; costs awarded subject to detailed assessment; permission to appeal refused.
Legal Topics
Letters of Indemnity, Third Party Rights, Specific Performance, Costs Orders
Commercial Law Shipping Law Contract Law Letters of Indemnity Third Party Rights Specific Performance Costs Orders

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Parties

Laemthong International Lines Company Limited

Claimant

Artis

First Defendant

Second and Third Defendants

Second and Third Defendants

Procedural Posture

Commercial Court Preliminary Issues / Judgment on Preliminary Issues and Directions

Legal Issues

  1. 1 Whether the claimant is entitled to an order that the first and/or second defendants provide bail or security to secure the release of the vessel from arrest
  2. 2 Whether the Charterers are entitled to an order that the Receivers provide bail or security to secure the release of the vessel
  3. 3 Whether the Receivers' letter of indemnity is enforceable by the Owners under the Contracts (Rights of Third Parties) Act 1999

Ratio Decidendi

The Receivers' letter of indemnity is enforceable by the Owners under the Contracts (Rights of Third Parties) Act 1999 as the Owners are the Charterers' agents for delivery and the indemnity was intended to benefit them. Both the Charterers and Receivers are obliged to provide security to secure the release of the vessel, and specific performance is appropriate as damages are not an adequate remedy.

Court Disposition

Declaration granted; specific performance ordered if necessary; costs awarded subject to detailed assessment; permission to appeal refused.

Orders

  • Declaration that Owners are entitled to enforce the Receivers' letter of indemnity.
  • Order for specific performance against Charterers and Receivers to provide security for release of the vessel if necessary.